Can You Afford to Not Work if You're Disabled?

Fewer Canadians have disability coverage through workplace benefits, according to a new survey.

Figures have declined significantly over the last few years, a RBC Insurance poll released on Tuesday finds.

Fewer than half, or 48 per cent of employed Canadians say they have disability coverage through work, compared to 57 per cent in 2015.

Of those without disability coverage through their workplace, 84 per cent of those polled say they haven’t bought coverage themselves, leaving them at financial risk if they’re unable to work due to a disability.

“With the majority of employed Canadians indicating that they do not have disability insurance through their workplace benefits package, workers need to review what coverage they do have and take immediate steps to ensure that they are well protected in case something were to happen,” said RBC Insurance senior director of life and health Maria Winslow.

“Without the proper financial protection in place, Canadians are putting themselves and their families at risk if they are faced with a disability and have to take time off work.”

Being off work takes a financial toll that many people are not prepared to handle.

A majority - 68 per cent - of working Canadians acknowledge the possibility of serious financial implications for them and their family if they were to become disabled and unable to work for three months.

In fact, when faced with a disability, 45 per cent of working Canadians would have liked to take time off due to disability but couldn’t because of finances, and 51 per cent said they were forced to go back to work earlier than they wanted because of their financial situation.

“When confronted with a disability, the last thing that should be on your mind is worrying about finances,” said Winslow.

“Purchasing individual disability coverage provides you with the security of knowing you will have money coming in to replace your lost income.”

Increasingly, where and how Canadians find work are strong barriers to accessing disability insurance coverage. Those without coverage say:

Their workplace doesn’t offer group benefits or disability insurance (35 per cent).

They work part-time or on contract and aren’t eligible for benefits (25 per cent).

They’re self-employed or freelance (22 per cent).

Cost is another key barrier - one in four (26 per cent) working Canadians without disability coverage feel they can’t afford it.

“There’s a misconception that disability insurance is expensive, yet it’s much less than you might think - generally costing between one and three per cent of your income,” said Winslow.